Installed, VL7.0 STD GOLD from LiveCD, rebooted, set things up as I like, logged out and upon login what appears to be the LiveCD desktop is back again even thought the disc is out and across the room.

I have the default background and the "makeliveCD" and "install VL" icons in addition to all the other stuff that normally appears in a live install. Is the Live session config files being saved in the new users desktop config file?